I\'ve been unsuccessful in getting Emacs to switch from 8 space tabs to 4 space tabs when pressing the TAB in buffers with the major mode text-mode.
text-mode
By the way, for C-mode, I add (setq-default c-basic-offset 4) to .emacs. See http://www.emacswiki.org/emacs/IndentingC for details.
(setq-default c-basic-offset 4)